Mortgage Rates “Earn” their level, July12, 2010

Mortgage Rate Trend Direction:      Neutral

Economic Reports/Rate Impact:     No Economic Reports Released Today

Key News:                                             US Company Earnings, European Debt/Currency

 

Summary

 

The week ahead will be focused on market reaction to earnings reports from American companies. Today will start slowly with only a few companies reporting. Key among those is Alcoa, a leading producer of aluminum and aluminum products. Alcoa does not report until after the market closes this afternoon, so it could be a slow day until then.

 

Mortgage rates are likely to hold at current levels at their initial pricing this morning (9:45 AM ET-10:00 AM ET).

 

Impact of economic reports

 

No economic reports are scheduled to be released today. At 1:00 PM ET, the Treasury Department will announce the results of the auction of 3-Yr Notes. No surprises are expected in the demand for these notes

 

Impact of international or political events

 

Most international stock markets are up modestly today and appear to be in a holding pattern much like the US awaiting more definitive data to guide trading.

 

An economist in Europe has stated that he believes that the likelihood of the Euro currency remaining the currency of its existing member countries is less than 50%. Julian Jessop, Chief International Economist with Capital Economics believes that one or more countries may leave the Euro (either by choice or by request from others).